Bill Text: NJ A4021 | 2016-2017 | Regular Session | Introduced
Bill Title: Permits contracting units to disqualify local public contract bidder with whom any contracting unit had prior negative experience; establishes prior negative experience database.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2016-06-30 - Introduced, Referred to Assembly State and Local Government Committee [A4021 Detail]
Download: New_Jersey-2016-A4021-Introduced.html
Sponsored by:
Assemblyman DAVID P. RIBLE
District 30 (Monmouth and Ocean)
SYNOPSIS
Permits contracting units to disqualify local public contract bidder with whom any contracting unit had prior negative experience; establishes prior negative experience database.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the disqualification of bidders for local public contracts, and amending and supplementing P.L.1971, c.198.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 4 of P.L.1971, c.198 (C.40A:11-4) is amended to read as follows:
4. a. Every contract awarded by the contracting agent for the provision or performance of any goods or services, the cost of which in the aggregate exceeds the bid threshold, shall be awarded only by resolution of the governing body of the contracting unit to the lowest responsible bidder after public advertising for bids and bidding therefor, except as is provided otherwise in this act or specifically by any other law. The governing body of a contracting unit may, by resolution approved by a majority of the governing body and subject to subsections b. and c. of this section, disqualify a bidder who would otherwise be determined to be the lowest responsible bidder, if the governing body finds that [it] :
(1) any contracting unit has had prior negative experience with the bidder as set forth in paragraph (1), (2), or (3) of subsection b. of this section; or
(2) there has been prior negative experience with the bidder as set forth in paragraph (4) of subsection b. of this section.
b. As used in this section, "prior negative experience" means any of the following:
(1) the bidder has been found, through either court adjudication, arbitration, mediation, or other contractually stipulated alternate dispute resolution mechanism, to have: failed to provide or perform goods or services; or failed to complete the contract in a timely manner; or otherwise performed unsatisfactorily under a prior contract with [the] a contracting unit;
(2) the bidder defaulted on a contract, thereby requiring [the local] a contracting unit to utilize the services of another contractor to provide the goods or perform the services or to correct or complete the contract;
(3) the bidder defaulted on a contract, thereby requiring [the local] a contracting unit to look to the bidder's surety for completion of the contract or tender of the costs of completion; or
(4) the bidder is debarred or suspended from contracting with any of the agencies or departments of the executive branch of the State of New Jersey at the time of the contract award, whether or not the action was based on experience with [the] a contracting unit.
c. The following conditions apply if the governing body of a contracting unit is contemplating a disqualification based on prior negative experience:
(1) The existence of any of the indicators of prior negative experience set forth in this section shall not require that a bidder be disqualified. In each instance, the decision to disqualify shall be made within the discretion of the governing body and shall be rendered in the best interests of the contracting unit.
(2) All mitigating factors shall be considered in determining the seriousness of the prior negative experience and in deciding whether disqualification is warranted.
(3) The bidder shall be furnished by the governing body with a written notice (a) stating that a disqualification is being considered; (b) setting forth the reason for the disqualification; and (c) indicating that the bidder shall be accorded an opportunity for a hearing before the governing body if the bidder so requests within a stated period of time. At the hearing, the bidder shall show good cause why the bidder should not be disqualified by presenting documents and testimony. If the governing body determines that good cause has not been shown by the bidder, it may vote to find the bidder lacking in responsibility and, thus, disqualified.
(4) Disqualification shall be for a reasonable, defined period of time which shall not exceed five years.
(5) A disqualification, other than a disqualification pursuant to which a governing body is prohibited by law from entering into a contract with a bidder, may be voided or the period thereof may be reduced, in the discretion of the governing body, upon the submission of a good faith application under oath, supported by documentary evidence, setting forth substantial and appropriate grounds for the granting of relief, such as reversal of a judgment, or actual change of ownership, management or control of the bidder.
(6) An opportunity for a hearing need not be offered to a bidder whose disqualification is based on its suspension or debarment by an agency or department of the executive branch of the State of New Jersey. The term of such a disqualification shall be concurrent with the term of the suspension or debarment by the State agency or department.
d. Within 30 days of discovering an experience described in paragraph (1), (2), or (3) of subsection b. of this section with a bidder, the governing body of the contracting unit shall adopt a resolution memorializing the experience and identifying the bidder, and shall forthwith thereafter deliver a copy of the resolution to the Division of Local Government Services in the Department of Community Affairs.
(cf: P.L.1999, c.440, s.8)
2. (New section) a. The State shall maintain a single, searchable Internet database accessible to contracting units that contains and displays:
(1) prior negative experiences reported to the Division of Local Government Services in the Department of Community Affairs, pursuant to subsection d. of section 4 of P.L.1971, c.198 (C.40A:11-4), including information identifying the bidder associated with each reported prior negative experience and the circumstances under which the experience constituted a prior negative experience; and
(2) bidders that are currently debarred or suspended from contracting with any of the agencies or departments of the executive branch of the State of New Jersey.
b. The Commissioner of Community Affairs, in consultation with the Director of the Division of Purchase and Property in the Department of the Treasury, shall adopt rules and regulations, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to effectuate the purposes of this section.
3. This act shall take effect immediately.
STATEMENT
This bill would allow local contracting units, including municipalities and counties, to disqualify a local public contract bidder, that otherwise qualifies as the lowest responsible bidder, if any contracting unit ever had a prior negative experience with that bidder. Under current law, a contracting unit may only disqualify a lowest responsible bidder for a prior negative experience if that contracting unit itself had a prior negative experience with the bidder. By contrast, current law permits boards of education to disqualify a bidder if any board of education had a prior negative experience with the bidder within the past 10 years. This bill would allow contracting units to look at the prior negative bidder experiences of any and all other contracting units. Providing these local governments with the ability to exercise more comprehensive due diligence in evaluating bidders will help ensure that contracts are awarded to truly responsible bidders, which would in turn increase reliability in contracting at the local level.
To facilitate this purpose, the bill also requires contracting units to report prior negative bidder experiences to the Division of Local Government Services in the Department of Community Affairs, for inclusion in a searchable Internet database of these prior negative experiences which contracting units may use to learn whether other contracting units had a prior negative experience with a particular bidder. This database would also have to include bidders that are currently debarred or suspended from contracting with any of the agencies or departments of the executive branch of the State, which is another prior negative experience that can serve as the basis for a contracting unit to disqualify a lowest responsible bidder.
